This special edition of Executive Talent looks at the past, present and future of the executive search and leadership consulting profession. In this section we compare data from AESC’s 2010 report Executive Search in Transition to today’s data, and use this to predict what the future holds for the profession.

executive_talent_2020This report shows that executive search is a robust business that provides a valued advisory service to clients. Based on figures for 2015, executive search represents on average 92% of the total revenue for our members. Executive talent acquisition is a sensitive and confidential process focused on the top leadership roles in an organization.  Clients clearly value being advised by experts who can be trusted based on their industry and functional expertise, and their ability to engage with and entice the best candidates locally and globally as needed.  In the 2010 report, two-thirds (67%) of AESC members expected demand in executive search to increase over the next five years. Looking at AESC’s State of the Industry data, we estimate that global revenues for the profession have increased by 27.9% during this time from $9.55 billion to $12.41 billion. But what has led to such strong growth?

In 2010 the profession was concerned about disintermediation from in-house talent acquisition teams and contingent recruiters. Over three-quarters (76%) of AESC members said that competition had increased, with 58% saying they were losing searches to contingency firms and 42% saying they were losing searches to in-house talent acquisition teams. Three-quarters (73%) of the clients we surveyed this year expect their use of executive search to either increase or stay the same over the next five years. As we reveal in the client section of this report, executive search is favored for confidential searches, board and C-suite searches, cross border searches, difficult to complete searches and searches where the salary level is above $200k USD. The data suggests, in fact, that contingent recruiters are expected to see a decline in their services as in-house talent acquisition continues to grow.   

How can executive search firms become closer to their clients over the next five years? We asked clients which metrics meant the most to them. In 2010 the majority of the metrics that were mentioned related to the search process (time to long/short list, quality of long/short list, quality of marketplace information etc.), but five years later the most important metrics are more sophisticated and results-oriented – the two most important metrics today are business performance of the successful candidate over time (70%) and tenure of the successful candidate (41%). One of the big takeaways from the candidate section of this report (section four, page 40) is that candidates placed by AESC members stay in their roles longer.

Finally, in the last five years diversity has become a much more prominent issue. Our 2010 report discussed the issue of diversity briefly, but today we see that it ranks among clients’ top business concerns. It is clearly a complicated issue, and one that varies around the world, but it is in the foreground of many executive talent conversations. AESC members are committed to diversity and the value that diverse leadership teams provide.

Read the full article on Executive Talent 2020, a special edition of AESC's quarterly e-magazine.


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